Nvidia Tumbles After Supply-Chain Woes Hurt Revenue Forecast
By Ian King and Mark Gurman
(Bloomberg) --
Nvidia Corp., the largest U.S. chipmaker by market value, slid in late trading after Chinese supply-chain woes and the war in Ukraine weighed on its sales forecast.
Revenue in the current quarter will be about $8.10 billion, the company said in a statement Wednesday. That compares with an $8.44 billion average analyst estimate. Gross margin, the percentage of sales remaining after deducting costs of production, will be about 66%.
The outlook reflects the continuing supply-chain chaos in China, where lockdowns have disrupted production and transportation lines. That’s made it harder for companies like Nvidia to capitalize on still-growing demand for chips. Nvidia also cited Russia, which invaded Ukraine and drew widespread sanctions earlier this year, for hurting its outlook.
Read more: Cisco’s outlook hurt by China supply crunch
The shares fell as much as 10% to $152.20 in extended trading. Nvidia’s stockhad gained 5.1% in regular trading on Wednesday, but remained down 42% for the year -- the victim of a broader rout afflicting the chip market.
Investors have grown concerned that the surge in demand during the pandemic years will fade, setting up one of the industry’s hallmark boom-and-bust cycles.
